Does Chinese foreign direct investment harm CO2 emissions in the Belt and Road Economies

Determinants that attract and discourage foreign direct investment in GCC countries: Do macroeconomic and environmental factors matter?

In general, foreign direct investments (FDIs) play a crucial role in driving a country's economic development, promoting diversification, and enhancing competitiveness. The Gulf Cooperation Council (GCC) countries, which heavily rely on the oil and gas sectors, are particularly vulnerable to fluctuations in commodity prices. However, these countries have recognized the imperative of economic diversification and have increasingly turned to inward FDIs to achieve it. By attracting capital, advanced technology, and expertise from foreign investors, FDIs enable the GCC countries to expand their economic base beyond the oil and gas sectors. This diversification not only creates employment opportunities but also fosters resilient economic growth, ultimately leading to an improvement in the living standards of the local population. This study investigates the macroeconomic and environmental factors that potentially attract foreign direct investment (FDI) inflows into the Gulf Cooperation Council (GCC) countries in the long run. Additionally, the study explores the causal relationship between these factors and FDI inflows. The panel autoregressive distributed lag (ARDL) approach to co-integration is the primary analytical technique used, utilizing long time-series data from six GCC countries, including Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates (UAE) during the period 1990-2019. The empirical results indicate that, in the long run, almost all independent variables significantly influence FDI in GCC countries. Variables such as GDP growth (GDPG), inflation (INFL), carbon dioxide emissions (CO2), and urbanization (URB) are found to be highly significant (p≤0.01) in their impact on FDI. Moreover, unemployment (UNEMP) also positively and significantly influences FDI in these countries in the long run. Based on the key findings, strategies aimed at reducing persistently high unemployment rates, maintaining population growth, viewing FDI as a driver for GDP growth, and continuing with infrastructure development and urbanization are expected to attract more FDI inflows into GCC countries in the long run. Additionally, fostering both long-term economic incentives and creating a conducive business infrastructure for investors are vital for attracting inward FDI into any nation, including those in the GCC. This research would benefit various stakeholders, including governments, local businesses, investors, academia, and the local society, by providing valuable knowledge and informing decision-making processes related to economic development, diversification, and investment promotion.

Utilizing green financing in developing green HRM resources for carbon neutrality: presenting multidimensional perspectives of China

This study examines how green finance may encourage the development of green human resource management (HRM) solutions to help China achieve carbon neutrality. For an empirical estimate, the Chinese data is subjected to DEA analysis, Tobit regression, and a sensitivity analysis model. The findings highlight the significance of green finance in the creation of green HRM solutions that aid firms in enhancing their environmental performance, boosting employee happiness, and getting them closer to their carbon neutrality goals. With the use of tools like green bonds and sustainable investment funds, businesses may raise capital for sustainability projects and encourage the adoption of environmentally responsible HRM practices. Moreover, the study results discussed the need to incorporate environmental sustainability considerations into HRM plans, enabling organizations to cultivate a sustainable culture and engage employees in supporting carbon neutrality through green practices in talent acquisition, training and development, performance management, and employee engagement. Incorporating environmental sustainability into HRM processes, boosting stakeholder involvement, and looking into new funding methods are all points emphasized in the study, which aims to enhance the uptake of green HRM initiatives.

The carbon reduction effect of "Going Global" strategy: an empirical perspective on the carbon emission efficiency of OFDI in China

Under the constraints of the "dual-carbon" objectives, how China can sustain economic development while concurrently achieving carbon emission reduction has become a pressing issue. With the rapid expansion of China's outward foreign direct investment (OFDI), elucidating its impact on carbon emission efficiency (CEE) assumes pronounced significance. Employing the systematic generalized method of moments (GMM) approach, based on panel data spanning the years 2006 to 2019 for China, this study primarily delves into the influence of OFDI on China's CEE. Furthermore, it probes into the mechanisms and asymmetries underpinning the relationship between OFDI and CEE. The principal findings are as follows: (1) augmentation of OFDI exerts a constructive effect on domestic carbon emission reduction, concomitantly yielding a discernible enhancement in CEE. A 1% increase in the magnitude of OFDI flow gives rise to a 0.009% improvement in CEE. (2) Mechanism verification reveals that heightened levels of OFDI operate through elevating green total factor productivity (GTFP), fostering optimal industrial structural adjustments, and invigorating green technological innovation, thereby elevating the CEE of the home country. (3) Asymmetry characterizes the impact of OFDI on domestic CEE, signifying a significant enhancement in regions with lower CEE while exhibiting less conspicuous effects in areas with higher CEE. This study furnishes policymakers with insights into leveraging OFDI to enhance CEE, thereby facilitating the attainment of the "dual-carbon" objectives.

The role of renewable energy investment and energy resource endowment in the evolution of carbon emission efficiency: spatial effect and the mediating effect

With climate change caused by massive greenhouse gas emissions emerging as an issue of global concern, it is urgent to improve carbon emission efficiency (CEE) for countries along the Belt and Road (BRI). Considering the resource endowment characteristics of green development in BRI countries, the super-efficiency slacks-based measure (SBM) model is adopted to evaluate the current status and tendency of CEE in 60 BRI countries, while the Global Malmquist-Luenberger (GML) index to quantify the spatial and temporal variation and dynamic evolution of CEE. Subsequently, from the perspective of energy development and utilization, the spatial Durbin model (SDM) and the mediating effect model are employed to empirically examine the spillover effects and driving mechanisms of renewable energy investment and energy resource endowment on CEE. Empirical results reveal that (1) from a static perspective, the CEE of BRI countries is generally poor and unevenly distributed in terms of temporal and spatial dimensions, with significant room for enhancement. (2) Referring to the dynamic level, the GML index featured a U-shaped fluctuation, with technological progress contributing to the improvement of CEE. (3) There is a significant positive effect of renewable energy investment on CEE in the home country and neighboring countries, while energy resource endowment presents a remarkable adverse correlation. Consequently, it is suggested that inter-regional cooperation among BRI countries should be strengthened to reinforce renewable energy investment, exert the technology and knowledge spillover effect sufficiently, and break the resource curse in the environmental field. (4) The mediating effect model confirms the significant mediating mechanism of technological innovation. Renewable energy investment can enhance the CEE of BRI members by promoting the positive mediating effect of technological innovation, while energy resource endowment can inhibit the local level of technological innovation and indirectly inhibit the CEE of BRI members. The findings provide new ideas on the green development and ecological sustainability of the energy industry in BRI members and other economies.

The drivers of carbon emissions in China: the perspective of fiscal decentralization

Fiscal decentralization determines government behavior considerably by being a major factor influencing China's carbon emissions. We analyze the impact of fiscal decentralization on carbon emissions on basis of the dataset of 30 Chinese areas for the period 2008 to 2020. We reveal that fiscal decentralization significantly raises carbon emissions, but worsens carbon emission efficiency. The impact of fiscal decentralization on carbon emissions varies significantly by geographical location and economic development level shocks. Local governments increase the expenditure on economic services while reducing the expenditure on basic public services as a result of the fiscal decentralization scheme, which is an important reason why the carbon emission level cannot be effectively improved. As such, it is necessary to keep pace with the times, and build a service-oriented government, and capitalize on the capabilities of local governments in terms of their service duties so as to maximize carbon reduction.

Can fiscal decentralization be the route to the race to zero emissions in South Africa? Fresh policy insights from novel dynamic autoregressive distributed lag simulations approach

There has been a plethora of debate on the link between fiscal decentralization and a drop in carbon dioxide (CO2) emissions, even though the evidence supporting this assertion is relatively sparse. Although the precise nature of this relationship is still up for discussion, economic hypothesis postulates that fiscal decentralization has an impact on environmental sustainability. Some researchers claim that fiscal decentralization could potentially result in a race to the top, while some believe it would lead to a race to the bottom. This analysis intends to shed light on the precise processes by which this connection may work in South Africa between 1960 and 2020 in light of current discussions in environmental and development economics. In contrary to previous studies, this paper employs a cutting-edge dynamic autoregressive distributed lag simulations methodology to evaluate the positive and negative variations in fiscal decentralization on CO2 emissions. Our findings demonstrate the prevalence of the race to the top strategy by illustrating how fiscal decentralization has a bearing on CO2 emissions reduction in the short and long terms. In accordance with the findings, greater fiscal decentralization should be implemented through the transfer of more powers to regional authorities, especially in the realm of environmental legislation considerations, in a bid to preserve South Africa's environmental integrity. By establishing a lower tier of government and defining roles at the federal and provincial divisions, South Africa could adopt strategies to improve green environment in an effort to fulfill the energy-saving tasks of fiscal expenditures.

Revisiting the nexus between fiscal decentralization and CO2 emissions in South Africa: fresh policy insights

The argument over fiscal decentralization and carbon dioxide emission (CO₂) reduction has received much attention. However, evidence to back this claim is limited. Economic theory predicts that fiscal decentralization affects environmental quality, but the specifics of this relationship are still up for debate. Some scholars noted that fiscal decentralization might lead to a race to the top, whereas others contended that it would result in a race to the bottom. In light of the current debates in environmental and development economics, this study aims to provide insight into how this relationship may function in South Africa from 1960 to 2020. In contrast to the existing research, the present study uses a novel dynamic autoregressive distributed lag simulation approach to assess the positive and negative changes in fiscal decentralization, scale effect, technique effect, technological innovation, foreign direct investment, energy consumption, industrial growth, and trade openness on CO₂ emissions. The following are the main findings: (i) Fiscal decentralization had a CO₂ emission reduction impact in the short and long run, highlighting the presence of the race to the top approach. (ii) Economic growth (as represented by the scale effect) eroded ecological integrity. However, its square (as expressed by technique effect) aided in strengthening ecological protection, validating the environmental Kuznets curve hypothesis. (iii) CO₂ emissions were driven by energy utilization, trade openness, industrial value-added, and foreign direct investment, whereas technological innovation boosted ecological integrity. Findings suggest that further fiscal decentralization should be undertaken through further devolution of power to local entities, particularly regarding environmental policy issues, to maintain South Africa's ecological sustainability. South Africa should also establish policies to improve environmental sustainability by strengthening a lower layer of government and clarifying responsibilities at the national and local levels to fulfill the energy-saving functions of fiscal expenditures.

Does foreign direct investment asymmetrically influence carbon emissions in sub-Saharan Africa? Evidence from nonlinear panel ARDL approach

In recent decades, the relationship between foreign direct investment (FDI) and carbon emissions has garnered the extensive attention by researchers and governments across the globe. Also, for most part, empirical studies on this nexus have assumed a symmetric relationship through the imposition of linear specifications. However, such relationships do not account for asymmetries in the impact of FDI on carbon emissions. In the case of sub-Saharan Africa, such relationships are crucial and need more careful analysis given the important role FDI plays in the development of the sub-region. Thus, this paper examines the asymmetric effect of FDI on carbon emissions in 41 selected sub-Saharan African countries spanning from 1996 to 2018. In order to decompose FDI into positive and negative partial sum and examine possible asymmetric effects of the variables on carbon emissions, we used the panel nonlinear autoregressive distributed lag (NARDL) approach. This method accounts for cross-sectional variances. Our results show that in the long run, a positive shock in FDI increases carbon emissions while a negative shock lowers them. Our results also show that carbon emissions respond asymmetrically to changes in FDI. It is recommended that comprehensive investment policies aimed at encouraging clean technology and environmentally friendly investments be implemented to ensure environmental sustainability.

The role of information communication technologies on carbon emissions in OECD countries: new evidence from method of moments quantile approach

This paper aims to investigate the effects of information and communication technologies (ICT) on carbon emissions (CO2) in the OECD area. For this purpose, a comprehensive panel data set is utilized covering the 1994-2018 period for 38 countries and a novel method of moments panel quantile regression model which allows to account for fixed effects and endogenous explanatory variables. Results suggest that the ICT, represented by the percentage of individuals using the Internet in the total population, contributes positively to CO2 emissions up to 0.40th quantile and has no effect after this level. The results imply that countries with relatively low per capita emissions are susceptible to the rebound effects, in which better energy efficiency results in increased demand for energy and ICT-related items, hence increasing carbon emissions. At this juncture, one policy idea would be to include a carbon tax into the per-unit purchase price of smartphones, tablets, smart gadgets, and any other relevant ICT items. Additionally, this legislation can assist decrease conspicuous consumption, which can be viewed as a trigger for the demand for ICT products. Additionally, these countries should encourage enterprises to invest in and employ energy-efficient technologies through tax incentives or subsidies.